Industry Minister Maxime Bernier went a long way towards
clearing up a murky picture when he told the audience at The 2006
Canadian Telecom Summit last month that the Canadian
Radio-television and Telecommunications Commission (CRTC) should
regulate the telecom market only when absolutely necessary. While
Bernier's message was welcome, the challenge now will be for the
government to follow through on its plans.
Until Bernier's speech there had been questions surrounding how
much regulation the CRTC would enforce.
In March, a government-appointed Telecommunications Policy
Review Panel recommended the Telecommunications Act be changed to
"promote reliance on market forces to the maximum extent
possible."
But in April the CRTC issued a decision stating that full
deregulation in specific markets could only occur once competitors
had won 25 per cent market share.
It looks now like the government will follow the review panel's
recommendations, which should be good news for Canadian businesses.
CRTC regulations are currently forcing incumbent carriers to charge
more for some services than the carriers would like to charge. The
regulations also slow the deployment of services by forcing the
incumbent carriers to go through the often lengthy CRTC approval
process.
The only good thing that can be said for regulation is that it
has allowed competitive providers to get into the market and offer
alternatives to the incumbent carriers. Cable companies like
Rogers, Shaw and Videotron have made solid headway in the consumer
market and can use their consumer revenues to help drive the launch
of business services. Regulation made sense while these competitive
carriers were getting their telecom businesses off the ground, but
now with at least some of the competitors are well established,
it's time to back off.
Hopefully the government will follow through on its telecom
policy statements quickly and reshape the CRTC's regulatory
framework before the CRTC completely stifles innovation in the
Canadian telecom market.
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